Friday, January 1, 2016

We can adjust our lives so that the State’s impact on us is minimised.

In recent years, I’ve been predicting that the governments, particularly those of the EU and US, will seek to eliminate paper currency. The objective will be to make monetary transactions between private parties as difficult as they can, by requiring that all transactions take place through financial institutions. If they can do this, they will effectively make a run on banks impossible in the future as the banks will simply shut off the money tap, as the Greek banks did. This power will additionally make negative interest rates and confiscations more possible.

A few years ago, this forecast was seen by most as poppycock, but the prelude has now begun, with most of the world’s banks disallowing large transfers and some lowering these amounts over time. Many governments are aiding the effort, requiring reporting on some transfers.

At some point, governments and banks will seek to eliminate paper currency, completing the encirclement of private party monetary transfer. From that point on, it would be illegal for any transfer of money to be undertaken except through a financial institution (most probably through the use of a plastic card or smartphone).

At about the same time as I began predicting the above, I also began forecasting what I considered to be a companion campaign against virtual currencies, such as Bitcoin. Such currencies will prove to be a threat to a bank-only transfer system as they would provide an alternate method of payment between private parties – one that does not come under the control of any government. Governments and financial institutions will therefore seek to eliminate virtual currencies, or make them too difficult to use.

The greatest weakness inherent in virtual currencies, in my view, is that they’re intangible. Unlike precious metals which, once physically possessed, exist forever, virtual currencies exist only as an idea. Like all fiat currencies, they have value only as long as two parties continue to have faith in their value. If one party decides that the value has ceased to exist, the other party is out of luck. The value of a virtual currency can go to zero if a willing recipient cannot be found.

Presently, virtual currencies pass from one hand to another but, at some point, are often transferred into something tangible, such as paper banknotes, in order to deal with those who will not agree to accept the virtual currency. I believe the attack against Bitcoin will begin at this point – banks and/or governments would make Bitcoin unacceptable for transfer into some other form of money.

Recently, the EU began a plan to crackdown on virtual currencies, with specific attention to Bitcoin. The European Commission plans to, “strengthen controls of non-banking payment methods such as electronic/anonymous payments and virtual currencies and transfers of gold, precious metals."

The justification for the crackdown, as stated by EU ministers, is, “to curb more effectively the illicit trade in cultural goods." Clearly, this has been in the works for a while, but the EU has been waiting for a suitable event to occur that will help the public to believe that the crackdown is justified. Not surprising, then, that the crackdown was announced shortly after the Paris attacks.

The two predictions described above are therefore coming together in quite a surprising way:The EU proposes to eliminate electronic money transfer by Bitcoin, aselectronic money transfer encourages and enables terrorism.The EU proposes to convert all retail banking to electronic money transfer, as electronic money transfer discourages and disables terrorism.

As blatantly self-contradictory as this is, the public will only absorb the claim that both measures are meant to kerb terrorism. Out of fear for their safety, they will blindly support both measures. Both measures will then take a portion of their freedom away.

And that’s the point of this article – the recognition of methods governments utilise to push through policies that, when examined, are clearly not in the interests of freedom.

One hundred years ago, in his Satyagraha campaign in South Africa, Mohandas Gandhi came before General Smuts, head of the Transvaal Government. He said quietly, “I want you to know I intend to fight against your government.” General Smuts laughed and replied, “You have come here to tell me that? Is there anything more you want to say?” to which Mister Gandhi answered, “Yes, I am going to win.” “Well,” said General Smuts, “and how are you going to do this?” Mister Gandhi replied, “With your help.”

Mister Gandhi did win. His method was to get the General to work against his own interests without knowing that he had lost control of them. Mister Gandhi understood that, if he undertook specific actions, the General would respond with knee-jerk reactions, not realising that he was being led down Mister Gandhi’s desired path until he no longer had any wiggle-room.

Today, leaders and policymakers are acutely aware of the complacency of the majority of people. Rather than use force to get people to give up their freedoms, they use the populace’s inclination to pay scant attention to the details of new policies – to instead follow the easy-to-absorb rhetoric instead. In this fashion, leaders can remove freedoms one after the other, no matter how transparent or even blatantly contradictory the methodology (as in the imposition of electric money transfers).It is the Nature of the State to Seek to Dominate the Populace

Freedom is one of the most precious and hard-won of all conditions in life. A government applies the removal of freedoms in a ratchet effect; once a freedom has been taken away from a population, it’s rarely returned. Therefore, freedom tends to deteriorate over time in any nation, no matter how idealistically-founded it may have been. As an illustration, we may review the British Magna Carta of 1215, or the American Constitution of 1787, and find that virtually all the “inalienable rights” contained in them have been either removed or watered-down dramatically through subsequent legislation. Neither the UK nor the US qualifies as a “free” state at this point.

But, if the reader is a UK or US citizen, he may not wish to accept this statement. If not, he might benefit from the advice of one Thomas Jefferson, who maintained that, "When governments fear the people, there is liberty. When the people fear the government, there is tyranny.” Today, in both countries, people are free to criticise candidates for election but, if they question the validity of the state to rule over them, they tend to look over their shoulder before speaking too loudly.

To repeat: “Freedom is one of the most precious and hard-won of all conditions in life.” Freedom is not static. Those citizens who hope that it will simply remain intact if unattended will be mistaken, for the State will always seek to remove freedoms over time. It’s therefore the chore of every citizen to remain ever vigilant and to question everything that his government seeks to do to initiate change. It’s often a dull, tedious task, but a very necessary one if the citizen values his remaining freedoms.

None of us can fully escape the more predatory tendencies of governments. We can, however, question their every move and adjust our lives so that the State’s impact on us is minimised.

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Contributors

International Covenant on Civil and Political Rights (Article 10):

1. Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers. This article shall not prevent States from requiring the licensing of broadcasting, television or cinema enterprises.

International Covenant on Civil and Political Rights (Article 19 Fri the 1st, 2):

1. Everyone shall have the right to hold opinions without interference.2. Everyone shall have the right to freedom of expression; this right shall include freedom to seek, receive and impart information and ideas of all kinds, regardless of frontiers, either orally, in writing or in print, in the form of art, or through any other media of his choice.